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14 Jan, 2023 06:01

Inflation in Sweden hits three-decade high

The data shows electricity and food topping higher than expected price growth
Inflation in Sweden hits three-decade high

Inflation in Sweden has soared to double digits for the first time in more than thirty years, fueled by soaring electricity and food prices, Statistics Sweden said on Friday.

Sweden’s inflation adjusted for fixed interest rates (CPIF), the measure used by the country’s central bank, jumped to 10.2% on an annual basis in December, up from 9.5% in November. The figures are higher than the rate of 9.1% projected by Riksbank, and of 9.8% expected by economists.

While inflation is cooling in some countries in the euro area, Sweden is still seeing price increases picking up pace, now reaching the highest level since 1991.

The consumer price index (CPI) accelerated to 12.3%, up from 11.5% in November. That was driven by record high electricity prices, which surged by 28% in December compared to the previous month, and by 45.3% compared to a year earlier, official figures showed.

“The fact that inflation excluding energy prices again surprises on the upside of the Riksbank’s forecasts gives the overall impression that little progress to curb inflation has been achieved so far,” senior economist at Svenska Handelsbanken AB, Johan Lof, said.

On an annual basis, prices for food and non-alcoholic beverages surged by 18.2%, while furnishing and household goods rose by 16.3%. Consumer prices advanced 2.1% in monthly terms representing the sharpest gain since January 1993.

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